How to choose the right international payment gateway for your business
The boom in international e-commerce offers a huge opportunity for businesses looking to expand globally. Selecting the right international payment gateway is critical to take advantage of this growth.
The numbers speak for themselves: According to the MarketsandMarkets™ report, the payment gateway market is expected to reach $48.4 billion by 2029 (growing at a CAGR of 12.6%). Considering this, choosing the optimal gateway is more than a strategic decision; it’s essential for keeping your business ahead in a rapidly evolving marketplace.
So, if you’re ready to take your business global, let’s dive into the strategies for selecting the ideal international payment gateway.
Map out your global ambitions
Before choosing a payment gateway, pinpoint your international business goals. Ask yourself these questions:
- Where are most of my international customers?
- How many international sales do I expect each month?
- Are these sales going to be small but frequent or large but occasional?
- What currencies do I need to handle?
By answering these questions, you refine your options, focusing on gateways tailored to meet your specific requirements (target markets, transaction volume, size, and currency requirements).
This strategic approach streamlines your operations and enhances international customer satisfaction by providing smooth transaction experiences personalized to their local needs.
Pay attention to authorization rates
Authorization rates measure the percentage of transactions that a payment gateway approves. This rate is a critical indicator of how effectively a gateway handles payment approvals across different credit cards and banks, especially in the international market.
Here’s why it matters: Low authorization rates can lead to lost sales. If customers frequently face transaction rejections, they may abandon their carts and look elsewhere. This affects your immediate revenue and can harm your brand’s reputation abroad.
So, you must look for an international payment gateway known for high authorization rates in your target regions. This might involve research into different gateways’ performances across various countries and currencies.
Also, look for a gateway that uses direct network connections as it boosts the payment success rate. By focusing on this aspect, you ensure smoother transactions for your customers, leading to higher satisfaction and repeat business.
Fraud management is non-negotiable
In 2023, the Federal Trade Commission’s Consumer Sentinel Network received more than 5.39 million complaints, nearly half of which involved fraud and about 19 percent related to identity theft. These staggering numbers underscore the critical need for robust fraud management in any payment gateway.
Effective fraud management will help protect your business and customers from illegal activities and enhance their experience. So, look for a gateway that implements intelligent security measures like 2-Domain Secure (2DS). It can differentiate between fraudulent and legitimate transactions.
This balance between security and ease of transaction ensures that legitimate purchases proceed smoothly without unnecessary roadblocks. Remember, this commitment to security is key to maintaining customer trust and business integrity in the global market.
Payment methods for different customers
Last but not least, understanding and accommodating your customers’ preferred payment methods becomes crucial when expanding your business internationally. A payment gateway with extensive reach can significantly influence your success across global markets.
Ensure the gateway supports popular regional card networks that local customers frequently use. Digital wallets like PayPal and Alipay also provide broad acceptance and can help capture a wider audience.
Additionally, consider the role of bank transfers; while they may be slower, they are often cost-effective and preferred for larger transactions in many regions. Overall, offering these diverse payment options can significantly reduce abandoned carts. If a card transaction fails, an effective gateway will quickly offer alternatives such as bank transfers or digital wallets.
This technique seamlessly turns potential declines into successful payments. This adaptability boosts sales and enhances customer experience and satisfaction.
Additional considerations
There are several additional factors to consider to ensure you’re making the best decision for your business. It includes:
- Customer support: Opt for gateways that provide robust customer support. Issues can arise anytime, and having access to prompt help is crucial.
- Regulatory compliance: Ensure the gateway complies with international financial regulations. This will protect your business and build trust with your customers.
- Transaction speed: Customers expect quick processing times. Evaluate the speed at which transactions are completed, as delays can lead to dissatisfaction.
- Multi-currency support: Handling transactions in multiple currencies is essential for international operations. Check that the gateway offers this functionality without excessive fees.
Final thoughts
Selecting the right international payment gateway is pivotal for businesses aiming to tap into the global market. As you weigh your options, prioritize a solution that meets your immediate requirements and has the flexibility to adapt to evolving market dynamics and technological advancements. This forward-thinking approach will safeguard your business’s future, enabling you to deal with the complexities of international commerce with confidence and success.
